Traders, lawmakers uncertain about new agreements

The past week has seen several developments on the trade front that could affect meat producers. Reuters reported on the news.

The new U.S.-China trade deal means farmers shouldn’t expect another year of trade aid once the current round runs out, U.S. Agriculture Secretary Sonny Perdue said. Farmers can currently expect the third tranche of a $16 billion aid package announced in May. But now that China’s purchases of U.S. agricultural goods will presumably increase under the preliminary deal recently signed by leaders from the two countries, farmers won’t need more assistance, Perdue said.

This news came as traders continued waiting to find out what the new U.S.-China deal actually means for them. U.S. livestock futures decreased amid that uncertainty. China’s promise that its purchases of agricultural goods will depend on “market conditions” caused “a little bit of uncertainty…as to how much beef may be ultimately in the phase one China trade deal,” said one analyst.

In North America, meanwhile, the U.S.-Mexico-Canada trade agreement, an update of NAFTA, has received support from Mexico and the United States. But despite the efforts of Canadian Prime Minister Justin Trudeau to get lawmakers to back the agreement, the main opposition party in Parliament is now raising doubts.

“We definitely want to give it the proper due diligence to shine a light on some of the unique [aspects],” said Randy Hoback, a spokesperson for the Conservative Party. Hoback said the deal could have negative consequences for the country’s dairy and aluminum sectors.

And as the United Kingdom prepares to leave the European Union at the end of the month, the country is beginning its trade talks with the EU and with other countries, including the United States. The EU has long refused certain products from the United States—including chlorinated chicken and hormone-treated beef. Britain may continue to refuse those items, especially given that it needs to maintain a working relationship with the European bloc. But some British lawmakers want Prime Minister Boris Johnson to prioritize U.S. talks over EU talks.